Traders News Source, an equity research and corporate access company focused on micro and small-cap firms released a comprehensive research report with no obligations on popular medicinal cannabis firm, Aphria Inc (CVE:APH). Last week, the company raised financing of C$100 million. The net proceeds will be used equally between Part 4 of the firm’s expansion strategy and working capital requirements.
Aphria is progressing well with its multi-phase expansion program. Upon closure of Part 2, it projects yearly production capacity to be at 5,500 kilograms of dried cannabis while cannabis oil production capacity is projected at 9,000 litres yearly.
The Canadian administration introduced Bill C-45 to legalize cannabis for medicinal as well as recreational use. Though the precise timeline is indeterminate, many expect legalization to follow within the first half of next year. Medical sales by approved producers are by now approved, but it remains unclear how recreational cannabis sales will be controlled.
The projected law does state that qualified producers under the ACMPR guideline will become licensed manufacturer under the new Cannabis Act. Hence, existing manufactures with established businesses and access to financing, like Aphria, would be positioned well to capitalize on new arising market opportunities.
Earlier in this month, Aphria reported a joint contract with Tetra Bio-Pharma for the supply of dried medical cannabis in the Maritime provinces and Quebec. Based on the show of the contract, the two companies may enter into other provinces. Commercial processes are expected to start in the summer of 2017, with sales being recorded shortly thereafter.
As per the report from ArcView Market Research, the customers in North America had spent over $6 billion on approved cannabis products last year, marking a 34% jump from the previous year. By 2020, this number could reach $18 billion. This clearly indicates a growing market for the company.